KOSPI Called Lower On Profit Taking

12/13/2012 6:32 PM ET

The South Korea stock market has closed higher now in three straight trading days, climbing more than 45 points or 2.4 percent in that span. The KOSPI closed just above the 2,000-point plateau, although now analysts are not sanguine about the market's chances to hold that line when it opens on Friday.

The global forecast for the Asian markets is soft, with lingering concerns about the looming fiscal cliff overshadowing a batch of largely upbeat economic data. Lawmakers in Washington continue to struggle to reach an agreement to avoid the fiscal cliff - which could overshadow a report showing that U.S. weekly jobless claims pulled back near a four-year low. The European and U.S. markets were down, and the Asian bourses figure to follow that lead.

The KOSPI finished sharply higher on Thursday with broadly based gains, although the technology stocks and automobile producers were especially strong.

For the day, the index surged 27.33 points or 1.38 percent to finish at 2,002.77 after trading between 1,976.18 and 2,002.78. There were 517 gainers and 282 decliners.

The lead from Wall Street is negative as stocks fell under pressure on Thursday, with lingering concerns about the looming fiscal cliff overshadowing a batch of largely upbeat economic data. Traders may also have been cashing in following recent gains.

Lawmakers in Washington continue to struggle to reach an agreement to avoid the fiscal cliff. House Speaker John Boehner, R-Ohio, once again accused President Barack Obama of failing to provide a serious offer, claiming that the White House is not offering enough in spending cuts.

Boehner has made similar remarks for several days, while Democrats continue to attack the GOP for being unwilling to accept higher tax rates on wealthy Americans.

The worries overshadowed a report from the Labor Department showing that weekly jobless claims pulled back near a four-year low. Jobless claims fell to 343,000 in the week ended December 8, down 29,000 from the previous week's revised figure of 372,000. Economists had expected claims to be unchanged compared to the 370,000 originally reported for the previous week.

Also, the Commerce Department said that retail sales increased 0.3 percent in November following a 0.3 percent decrease in October. Economists had expected an increase of 0.6 percent. Excluding a 4.0 percent drop in sales by gas stations, retail sales rose by 0.8 percent in November compared to a 0.5 percent drop in October.

Traders also continued to digest the Federal Reserve's plan to replace "Operation Twist," which expires at the end of the year, with the purchase of longer-term Treasury securities at a pace of $45 billion per month.

The major U.S. averages were down on Thursday as the Dow fell 74.73 points or 0.6 percent to finish at 13,170.72, while the NASDAQ slid 21.65 points or 0.7 percent to close at 2,992.16 and the S&P 500 dropped 9.03 points or 0.6 percent to end at 1,419.45.

In economic news, the Bank of Korea's monetary policy board on Thursday decided to keep the nation's benchmark interest rate unchanged at 2.75 percent. The forecasts were split heading into the decision, with several analysts expecting a reduction of 25 basis points to 2.50 percent.

That's because the inflation rate dipped to 1.6 percent in November, well below the central bank's target range of 2 to 4 percent. The central bank had trimmed the rate by 25 basis points in October before holding it steady in its November meeting.